Pippa Middleton
The Duchess of Cambridge's sister Pippa is reportedly dating millionaire James Matthews.Reuters

It appears that rumours the Duchess of Cambridge's sister Pippa is in a relationship with the Duchess's brother-in-law Prince Harry are not true. The 32-year-old reportedly has rekindled her romance with millionaire James Matthews.

Middleton and Matthews were recently spotted on holiday together and have reportedly been seeing each other for two months. The aunt of Prince George and Princess Charlotte ended a three-year relationship with hedge fund manager Nico Jackson in October and was once again linked to Prince Harry.

The new couple, who briefly dated in 2012, were tentative in their relationship at first but are now getting serious, a source told The Daily Mail. Middleton and Matthews spent eight days on holiday together in the exclusive Caribbean island of St Barts, where his parents own and manage the Eden Rock Hotel.

"James is really into Pippa and she is falling into step. There is affection between them," the source said. Matthews, the 40-year-old chief executive of Eden Rock Capital Management, joined Middleton, her brother James and his girlfriend Donna Air as they holidayed at a luxury villa in the hills overlooking the island's capital, Gustavia.

According to the Daily Mail, the two couples spent an idyllic week together, playing tennis and visiting the best restaurants the island has to offer.

Before getting back together, the new couple reportedly kept in touch. Middleton was even seen leaving Matthews's house a month before she ended her relationship to Jackson. "James has always been on the scene," a source told E! News. "He is super charismatic and charming, good looking and always held a torch for Pippa. They have always had insane chemistry, but Pippa was always in a relationship."

The source added that Matthews is a much better fit for Middleton than Jackson. "[He's] more social and outgoing than Nico, loves society events and celebrity events. Nico never really enjoyed the spotlight. James revels in it," the source said. "Pippa loves socialising and, with James on her arm, there will be plenty more of it."

E! News noted that Middleton is being careful about how her new relationship develops due to Matthews's brother — reality TV star Spencer Matthews. "Spencer Matthews has a terrible reputation in the UK as a philandering womanizer and is horribly unpopular at home," the source said. "For Pippa to be actually dating the brother of the lead character has raised many eyebrows, another reason why she is going to be careful about how the relationship pans out."